News Corp split 'being championed by COO Chase Carey'

An analyst with an investment banking advisory firm says the proposed split of
News Corp into two publicly traded companies, is favoured by its Chief
Operating Officer as the "best thing for shareholders".

10:00PM BST 26 Jun 2012

Rupert Murdoch's News Corp has confirmed that it is considering splitting into two publicly traded companies, sending its shares up 6 per cent as investors bet the troubled publishing business will be spun out of the more lucrative entertainment arm.

Shareholders have been pushing for some time for News Corp to get rid of its newspapers business, after the phone hacking scandal hit Murdoch's British newspapers and forced the company to drop its proposed acquisition of pay-TV group BSkyB.

Alan Gould, an analyst with investment banking advisory firm Evercore Partners said: "Strategically there wasn't much synergy between the publishing assets and the other assets at News Corp."

A split would be the clearest sign that the global media conglomerate is making a break from its newspaper roots, and will raise new questions about the succession plan at the family-controlled business with an 81-year old patriarch.

Many investors have said they favour Chief Operating Officer Chase Carey to take the chief executive job running the entertainment business, perhaps with Rupert Murdoch as chairman.

Mr Gould said "If you would have asked me five years ago and told me Rupert would, A, buy back stock and B, split off publishing, I would have said you were crazy.

"He never wanted to shrink the empire. He never wanted to split off the publishing assets.

"But I think it's a combination of the hacking scandal, how the publishing business has changed because it's clearly changed over the last five years and I think it's the influence of Chase Carey, who I think Rupert truly respects quite a bit and Chase thinks this is the best thing for shareholders and I think he's having an impact."